Stock market today: Dow, S&P 500, Nasdaq soar as inflation cools, bank earnings shine

JPMorgan (JPM) shares traded just above the flat line on Wednesday despite a large profit-boost for America’s largest bank.

Yahoo Finance’s David Hollerith reports:

Last year JPMorgan Chase (JPM) churned out more profits than it ever has before as it earned $14 billion in the final quarter of 2024.

Its full-year profits rose to $58 billion, an all-time record for JPMorgan and the most ever in the history of American banking. Its fourth-quarter profits were up 50% from the year-earlier period.

That results were buoyed by a surge in JPMorgan’s Wall Street operations, as dealmaking makes a comeback across the industry following a two-year-long drought. JPMorgan’s investment banking revenue was up 49% from a year earlier.

Read more here.

A broad-based rally in stocks took hold at the open of Wednesday’s trading session on Wall Street.

All 11 sectors were in the green with interest-rate-sensitive sectors such as Real Estate (XLRE) and Utilities (XLU) leading the charge. Five sectors were outperforming the S&P 500’s (^GSPC) 1.3% gain.

A recent headwind for stocks died away on Wednesday morning.

The 10-year Treasury yield (^TNX), which had been up at its highest level in more than a year, dropped more than 12 basis points to 4.66% following a cooler-than-expected consumer inflation reading.

Meanwhile, stocks rallied, with futures tied to the major averages all rising 1.5% or more.

Fresh consumer inflation data out Wednesday showed prices increased less than expected in December.

The Consumer Price Index data from the Bureau of Labor Statistics showed that on a “core” basis — which strips out the more volatile costs of food and gas — prices increased 0.2% month-on-month. That was lower than the 0.3% economists had expected.

On a yearly basis, core prices increased 3.2%, below the 3.3% economists had projected. It was the first move lower in the metric since July.

The headline CPI increased 2.9% over the prior year in December, an uptick from the 2.7% seen in November but in line with economists’ expectations. The index rose 0.4% over the previous month, topping the 0.2% increase seen in November and also on par with ‘ estimates.

Yours truly is getting ready to head out for another week of impactful reporting at the World Economic Forum in Davos, Switzerland — which kicks off next Monday. I will have more to say on what we will be doing there in this Sunday’s Morning Brief newsletter.

I will quickly note that a source familiar with the matter tells me President Trump will be speaking by video feed on Thursday, just days after his inauguration (and perhaps a flurry of executive orders).

But ahead of that fun, I thought WEF’s annual global risk report that dropped this morning is an interesting read. The top risk is “state-based armed conflict.” Other top risks include misinformation and disinformation (good to see Zuck no longer fact-checking at Meta…), extreme weather events, societal polarization, cyber-espionage and warfare.

Thinking a lot of these risks aren’t priced into Mag 7 stocks!

“Rising geopolitical tensions and a fracturing of trust are driving the global risk landscape” said WEF managing director Mirek Dušek in a statement. “In this complex and dynamic context, leaders have a choice: to find ways to foster collaboration and resilience, or face compounding vulnerabilities.”